On a Monday morning in early November, Asian markets climbed back from a bruising Friday, as the technology sector that had been pulled down by the week's political shock began to find its footing. The rout had started in Washington, where midterm results handing Democrats a sweeping win unsettled investors who feared that newly empowered legislatures might slow the sprawling construction of data centres that power artificial intelligence. The recovery in Taipei and Tokyo is real but partial, a reminder that a fall of this size is rarely repaid in a single session. Beneath the numbers lies a q
Asian Markets Rebound as Tech Sell-Off Eases After Democrats' Midterm Win
A $2.5 trillion sell-off, then a Monday rebound across Asia
On a Monday morning in early November, Asian markets climbed back from a bruising Friday, as the technology sector that had been pulled down by the week's political shock began to find its footing. The rout had started in Washington, where midterm results handing Democrats a sweeping win unsettled investors who feared that newly empowered legislatures might slow the sprawling construction of data centres that power artificial intelligence. The recovery in Taipei and Tokyo is real but partial, a reminder that a fall of this size is rarely repaid in a single session. Beneath the numbers lies a quieter question about whether the AI boom's physical foundations are now entangled with the rhythms of democratic politics.
By early Monday in Taipei, the Taiex had climbed 5.72 percent, the strongest gain among Asia's major indexes, as the region's technology stocks tried to recover from a painful stretch. Tokyo's Nikkei 225 rose 3.45 percent, Seoul's Kospi added 1.68 percent, and Hong Kong's Hang Seng barely moved. The rebound followed a steady Wall Street rally on Friday, but it came after real damage.
The trouble began on Thursday, when the US midterm results gave the Democratic Party a sweeping victory. Investors feared that Democratic-controlled legislatures might slow the construction of the data centres that power artificial intelligence, and Wall Street lost $2.5 trillion in a single session. That fear spread to Asia on Friday, when the Nikkei fell about 6 percent and the Kospi dropped nearly 9 percent. Monday's gains recover only part of that ground.
Futures for the S&P 500 and the Nasdaq 100 were also modestly higher early Monday, after dipping on news that Nvidia's board would investigate chief executive Jensen Huang over a past romantic relationship with a woman accused of being a Chinese spy. The board said it remained confident in Huang and had no evidence that national security or company secrets were compromised, and Huang pledged full cooperation with the independent inquiry.
The week therefore opens under two pressures at once: a political question about how data centres will be treated in Washington, and an unresolved personal scandal at the most valuable name in chips. Investors will be watching closely to see whether the inquiry weighs on chip shares, and whether any regulatory signals emerge that could settle nerves.
By 04:00 GMT on Monday, the Taiex in Taipei stood 5.72 percent higher, the sharpest climb among Asia's major indexes as the week began. It was part of a broad recovery after a rough few days for technology stocks across the region.
In Tokyo, the benchmark Nikkei 225 was up 3.45 percent at the same hour. In Seoul, the Kospi had gained 1.68 percent. Hong Kong's Hang Seng Index was the laggard, up just 0.19 percent. The moves followed a rebound on Wall Street on Friday.
The gains came after the damage. On Thursday, the US midterm results, which handed the Democratic Party a sweeping victory, set off a $2.5 trillion sell-off on Wall Street. The worry driving it was that Democratic-controlled legislatures could slow the rollout of the data centres that power artificial intelligence.
The selling reached Asia on Friday. The Nikkei 225 fell about 6 percent and the Kospi dropped about 9 percent, while the Hang Seng slid by more than 1 percent. Monday's advances recover part of that ground, though the article does not say how much.
Early Monday, futures for the S&P 500 and the tech-heavy Nasdaq 100 were up 0.60 percent and 0.59 percent respectively. Both had dipped earlier, after Nvidia announced it would investigate its own chief executive.
The subject is a romantic relationship Jensen Huang had with a woman accused of being a Chinese spy. Nvidia's board said it remained confident in Huang and had no reason to believe national security or company secrets had been compromised. Even so, it said an independent inquiry would examine "all available information." The board added that Huang supports the inquiry and has pledged his full cooperation.
In its statement, the company said the board prioritizes US national and economic security, which it called paramount to the interests of Nvidia and its shareholders.
So the week opens with two separate pressures on chip and AI stocks: the political question of how Democratic-controlled legislatures might treat data centre construction, and the Nvidia inquiry. Investors will be watching whether the inquiry weighs on chip shares and whether any signals emerge from Washington on regulation.
Citations marquantes
The Board prioritizes U.S. national and economic security, which is paramount to the interests of NVIDIA and its shareholders.— Nvidia board statement
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